The world is in the midst of a boom in geopolitical uncertainty... Just consider the following regions: West Africa, Scotland, Pakistan, Isreal/Gaza, Syria, Iraq, Russia/Ukraine, Thailand, and now Hong Kong. Amidst these rapidly rising risks, I find the relative calm of asset markets quite confusing. Is this an unintended consequence of global central banks printing money (in some cases uncontrollably) over the past several years? Have capital markets grown numb to risk?
NY Fed president William Dudley recently noted that these events "are horrible for the people involved, but there is not a lot of connectivity in terms of economic mass back to the rest of the world, and so long as things are contained in those areas and financial markets are aware of them, it doesn’t actually lead to a whole lot of volatility."
Since he uttered those words, the Ebola virus has arrived in the United States, China is facing a rapidly escalating dilemma in Hong Kong, and Russia is contemplating the use of capital controls... Have we entered a new world of rapidly rising volatility?
My latest comment was about edible insects and how they offer the potential to meaningfully change the demand dynamics affecting livestock, feed, grain, water, and fertilizer. Is it conceivable that backyard pests can feed the world? Read more HERE.
60% of global cocoa production is produced in the Ivory Coast and Ghana. How might an Ebola-related disruption to the cocoa supply chain affect global markets? Read my comment HERE.
Pakistan is one of the most food-vulnerable countries in the world, making it a tinderbox in which any catalyst might ignite unrest. Can hunger explain recent protests? Read my comment HERE.
Butter consumption recently hit a 40-year high, and not surprisingly, butter prices surged to a 16-year high. What are the implications of these developments? Are bakers doomed? Read my comment HERE.
The world is expected to have more than 1 billion children (humans under the age of 18) on the African continent by the year 2050. What does this mean for our population guestimates? Read my comment HERE.
My book was recently translated into Korean...a very obvious indicator of rising interest in the study of bubbles . Any insight in this development? The preface to my book is titled "Is there a Bubble in Boom-Bust Books?" Hmmm...